If a product has zero external costs, then
A) marginal social cost equals marginal private cost.
B) marginal social cost is greater than marginal private cost.
C) marginal social cost is less than marginal private cost.
D) marginal social cost equals zero.
E) We need more information to determine the relationship between marginal private cost and marginal social cost.
A
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If the Fed’s monetary policy causes a substantial decrease in interest rates, what is the most likely impact on velocity?
A. Velocity will decrease. B. Velocity will increase. C. Velocity will remain constant. D. Velocity is unrelated to interest rates.
If real GDP is $10 trillion and the velocity of circulation is 2, the quantity of money
A) is $2 trillion. B) is $5 trillion. C) is $20 trillion. D) cannot be determined from the information given.
If the nominal money supply rises by 6 percent, the price level rises by 4 percent, and output rises by 3 percent, then according to the quantity theory equation, income velocity must rise by:
a. 7 percent b. 13 percent c. 1 percent. d. 3 percent.
The answer is: "There is a net loss to society." What is the question?
A) What causes the distributional effects to outweigh the aggregate effects? B) What is an effect of a reduction in producers' surplus? C) What is an effect of consumers' surplus? D) What is the effect of a tariff instead of a quota? E) none of the above